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Business News

Lagos State to fund N1.17 trillion budget with tax expansion

Sam Egube has disclosed that Lagos state would expand its tax net, which is considered too low for its population size, to fund the 2020 budget

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Lagos State to use LIRS to fund N1.17 trillion 2020 Budget 

Lagos State government has disclosed it would expand its tax net to fund the N1.17 trillion 2020 budget. The State’s Commissioner for Economic Planning and Budget, Sam Egube, said.

The state government currently has a total revenue estimate of N1.07 trillion to fund the budget. This consists of Internally Generated Revenue (IGR) of N886.04 billion and N184.99 billion from the federal government.

Lagos State to use LIRS to fund N1.17 trillion 2020 Budget 

Tax to the rescue for Lagos: While the deficit is expected to be financed from external loans of N34.5 billion and domestic loans of N63 billion, the state plans to widen its tax net to enable its IGR to meet up with the expected financial support needed to fund the budget.

The method being applied by the state tax administrator to expand its tax base is the deployment of technology and other facilities. This will also be employed to improve the efficiency in operations of all revenue-generating agencies.

“We believe that there are huge revenue-generating opportunities in the informal sector…,” the commissioner said in a Punch report.

(READ MORE: Over 56% of 2019 budget expenditure released for capital projects- Minister)

Note that total revenue of N775.23 billion, out of which N606.29 billion was expected from internal generation, N168.94 billion from federal transfers and N77.09 billion from deficit financing, was projected in 2019.

Budget breakdown: As expected, the budget for each sector is different, and according to Egube, the 2020 Budget was concluded upon based on consultations with stakeholders. Below are the budgets for some sectors.

  • The education sector got the highest allocation of N136.1 billion. It was N70.41 billion higher than that of the 2019 budget and would cater to the reconstruction of 300 schools, provision of furniture for both primary and secondary schools across the state and equipment for science laboratories.
  • Roads and infrastructure got the second-highest allocation of N117.248 billion against the N31.673 billion expended in 2019. According to the commissioner, the increase would address the zero-pothole strategy and create link roads within the metropolis to solve the challenges of traffic congestion. On the development of infrastructure along the coastline, we have a provision of N11.29 billion that has been earmarked to enhance our coastal infrastructure in order to curb ocean surge and protect lives and properties.
  • Health, environment, and housing got the third, fourth and fifth-highest allocations of N111.775 billion, N66.586 billion and N48.559 billion respectively.
  • Traffic management got an allocation of N44.51 billion as against the N17.59 billion budgeted in 2019. Nairametrics learnt that this would address junction improvement throughout the state and ensure the completion of trailer parks among others.

Egube said full implementation of the budget would be the priority of the government.

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Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

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Business News

Heavy sell-off in Guinness shares leads to N6.9 billion market value loss in a single day

Shares of Guinness Nigeria Plc suffered a 9.89% loss today.

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Guinness Nigeria Plc Reports Full Year F19 Results

Guinness Nigeria Plc suffered a 9.89% loss today following a heavy sell-off in the shares of the brewer. This triggered a market value loss amounting to about N6.9 billion at the close of trading activities on the Nigerian Stock Exchange, as investors scaled-down stakes in the brewer.

Data tracked at the close of the market today revealed that the shares of GUINNESS declined from N31.85 per share at the market open, to N28.70 per share at the close of the market today, to print a loss of 9.89%.

This decline saw the market capitalization of the leading maker of beer and spirits fall from N69.75 billion to N62.86 billion at the close of trading activities today, putting the total market value loss at N6.89 billion.

The shares of Guinness at the close of the market today cleared at N28.70 per share, 9.89% lower than the closing price of N31.85 per share yesterday.

At the current price, Guinness shares are currently trading 20.27% lower than their 52-week high of N36.00 per share. However, the shares of the company have returned about 120.8% gains for investors who bought them at their 52-week low trading price of N13.00 per share last week.

During trading hours on the Exchange today, about 159,380 ordinary shares of Guinness Nigeria Plc worth about N4.57 million, were exchanged in 27 executed deals.

The shares of Nigerian Breweries Plc and Golden Guinea Breweries Plc closed flat at N50.1 per share and N0.81 per share respectively, while the shares of International Breweries Plc shed 0.88% to close low today at N5.65 per share.

What you should know

  • At the close of trading activities today, the NSE All-Share Index and market capitalization appreciated by 0.29% to close higher at 39,128.34 index points and N20.477 trillion respectively.
  • The NSE Consumer Goods Index, an investable benchmark designed to track the performance of the shares of consumer goods companies like Guinness Nigeria Plc, depreciated by -0.35% to close the day lower at 553.26 index points.

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Business News

NAICOM revokes operational licence of UNIC Insurance, appoints Receiver/Liquidator

NAICOM stated that it had appointed Hadiza Baba Gimba as the Receiver/Liquidator to wind up the affairs of the company.

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Recapitalisation: 26 firms get NAICOM's approval

The National Insurance Commission (NAICOM) on Wednesday announced the withdrawal of the operational licence issued to UNIC Insurance Plc.

Although no official reason has been provided for the revocation of the insurance firm’s operating license, NAICOM, however, stated that the decision of the regulator was in the exercise of the powers conferred on it by the enabling laws.

According to a report from the News Agency of Nigeria (NAN), this disclosure is contained in a notice which was issued by the commission in Lagos to the general public and policyholders, where it noted that the revocation of the operational license, RIC 043, is with effect from March 25.

NAICOM, thereafter stated that it had appointed Hadiza Baba Gimba as the Receiver/Liquidator to wind up the affairs of the company.

NAICOM in its statement said, “The general public/policyholders are by this notice required to direct all inquiries and correspondence regarding UNIC Insurance to the receiver/liquidator.

The receiver/liquidator will be dealing with the company’s liabilities in accordance with the provision of Insurance Act 2003.’’

What you should know

  • It can be recalled that NAICOM, for the third time in June 2020, gave insurance firms in the country a one-year extension to meet the recapitalisation obligation that was recently set for them apparently due to the coronavirus pandemic which had disrupted the activities of most insurance companies.
  • Some insurance companies had been going through some bad patches with a good number of them struggling to meet up with their obligations and the recapitalization requirements.
  • The recapitalisation programme requires life insurance firms to meet a minimum paid-up capital of N8.0 billion, up from N2.0 billion previously. In the same vein, general insurance companies are required to raise their minimum paid-up capital to N10.0 billion from N3.0 billion previously.
  • The regulatory capital for composite insurance was raised to N18.0 billion from N5.0 billion previously while reinsurance businesses are now required to have a minimum capital of N20.0 billion from a previous N10.0 billion.

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